Guy Barnett (Tasmania, Liberal Party) Share this | Hansard source

I stand today on behalf of Liberal senators to note at first instance that we have had a meeting of the Legal and Constitutional Affairs Committee on this matter and also to note that that report has been tabled and is available for the public record. I want up-front to thank the members of the committee secretariat—Peter Hallahan in particular, and his team—for their professional and swift action to pull this report together in the time available. We have had a good deal of deliberation over the passenger movement charge, which is commonly referred to and known as the departure tax. We do not agree with this particular increase in the passenger movement charge and we are of the view that the increase is very poorly timed, it is excessive in the circumstances and it has certainly been insufficiently explained by the government in their legislative proposal. We will not be opposing the Passenger Movement Charge Amendment Bill 2008, because it is a budget measure of the government, but nonetheless we are deeply concerned about a number of issues that were raised in evidence to the committee. I would like to draw these to the attention of the Senate.

First of all, there is the adverse impact on tourism and the aviation industry. This was consistent in all the evidence put to our committee. I want to recognise the various submitters and witnesses before our committee: the Board of Airline Representatives of Australia; the Australian Airports Association; the Australian Tourism Export Council; Adelaide Airport, which had representatives appear; and the International Air Transport Association, which made a very telling submission about the impact on air transport across the globe and the very precarious position it is in. We had a short submission and evidence from the Australian Customs Service, which I will come to shortly. The Tourism and Transport Forum, which were well represented, well presented and very professional, gave a very cogent submission. We also had a submission from Virgin Blue Australia.

In terms of the adverse impact on tourism, and the fact that it could not have come at a worse time, this is what they said—this is very serious. We had representatives of the tourism industry, airlines and airport operators, as I indicated. They argued that the increased charge, taken together with other increased charges in the federal Labor budget, such as the increased visa-processing charges for non-electronic travel authority markets, could not have come at a worse time for the industry. And what have the government done about it? What modelling, what impact assessments have they done on this charge and its impact on the industry? They have done nothing. And what consultation has occurred with respect to this charge, a very hefty increase indeed of some 25 per cent? There has been no consultation whatsoever. That is on the record. I asked that particular question of all the witnesses I could. The answer was none; there was no consultation.

The tourism industry at the moment is under considerable pressure. They are pressured due to a range of external factors such as the high Australian dollar and high oil prices, which have been leading to higher fuel charges for the airlines. Of course it is hard; it is a very stressful time at the moment. The opposition senators acknowledge this, and we want to put on the record that we are concerned for the industry. We are not convinced that the government has sufficiently considered the impact of this increased charge on this important but currently beleaguered export industry. I want to note here and now that this industry is the second-largest earner of export income for our country. That should be well noted. We want to thank the tourism industry for their work, their advocacy and their impact and benefits throughout Australia. Conditions now are very different from when the charge was last increased, and there is a real risk that the increase will decrease the Australian tourism industry’s ability to compete in a highly competitive and price sensitive market.

Opposition senators were particularly concerned with the evidence from the Tourism and Transport Forum that government fees and taxes significantly inflate ticket prices. This is a concern not just for the industry but for consumers. The Tourism and Transport Forum told the committee:

If we add in the passenger movement charge with the visa application fees and the other multiple fees that are levied, it is topping out at over 20 per cent of the ticket, and we know that the ticket is the barrier to travel to Australia, so we suspect it is significant.

The International Air Transport Association sent in a submission at very short notice, and we thank them for that. They told the committee that studies that they were aware of had shown that a 10 per cent increase in the cost of travel can lead to a 15 per cent reduction in travel demand. As I have indicated, it is a 24 per cent increase in the charge that this government is imposing upon the industry. It is a very large increase. The government have admitted that they have not undertaken any modelling of the impact of the increased charge to determine the extent to which government charges are decreasing the competitiveness of the tourism industry. I am pleased to say that it is not just the Liberal senators who have this view. The chairman’s report demonstrates and all senators are of the view that there is a need for that modelling to be undertaken as soon as possible.

On the issue of transparency and accountability, there is one great, big, gaping hole in this legislative program from the government. Virtually all the submissions and evidence that we received focused on an alleged lack of transparency in relation to the PMC and a lack of accountability concerning how funds purportedly raised for purposes such as the provision of Customs services are spent. Several witnesses and submitters also contended that the PMC overcollects, a matter of concern to opposition senators. I will come to that again shortly. I have indicated that there was an entire lack of consultation with the industry and industry representatives. That is a great disappointment to Liberal senators. We hope that the government will improve its act in terms of ensuring that consultation is reignited and occurs. In terms of the lack of transparency and confusion about policy objectives, Virgin Blue made some key points, and those are set out in our report; I will not go into them now.

There are concerns about the fact that all of the key airports around Australia have now been privatised. They are all now in private hands, apart from the Cairns airport; they are privately owned. And the Australian Customs Service and other government agencies—Quarantine and Immigration but also, particularly, Customs—pay no rent for the facilities they use and the services they receive. This was a view that was strongly supported by Adelaide Airport in evidence to the committee. The Australian Airports Association said in its evidence:

... post privatisation and in a true commercial sense it would give some clarity to what Customs, Quarantine and Immigration actually need to identify, and it would give them some commercial responsibility to account for the spaces that they need to do their job.

The AAA said that tens of millions of dollars of free facilities were offered to the Australian government each year. Certainly, senators on this side of the chamber—those with a business background in particular—know full well the importance of transparency and accountability. These are private operators. Why should they be offering these facilities for free to the government just because their airport was previously owned by the government? It is not right. It is not appropriate, and we think it is an unfair deal. We want to draw it to the attention of the government so that a fair deal can be pursued in the months and years ahead.

The Board of Airline Representatives of Australia put forward a set of guiding equity and transparency principles relating to efficiency, user-pays and equity, public accountability, transparency and quality of service. We have made a recommendation to support those guidelines and the implementation of them. We thank the Board of Airline Representatives of Australia for their evidence in that regard.

The evidence to the committee from the Tourism and Transport Forum Australia said that there was an underestimation of total revenue over the four-year period. As you know, the government has estimated a revenue stream of $459.3 million over that four-year period. Well, the TTF disagree. They say that is an underestimation and that the total revenue over that period would be something like $600 million. Have the government got their figures right? I know Senator Ronaldson yesterday in a debate was talking about the government’s shambolic approach to the administration of the affairs of this country. We have to ask: have the government got their figures right? The TTF would say not. They say there is an underestimation by $140-odd million over four years. Time will tell. Be assured that, through the budget estimates process, we will pursue the department and this government to find out if they have sharpened their pencil or if they are taking a lackadaisical approach and acting in a dilatory manner.

The need for transparency is very important. We have drawn a number of conclusions in the Liberal senators’ report which we bring to the attention of the Senate. We will not oppose this measure, because it is a budget measure, but we do urge the government to give urgent consideration to the following. The first issue is deferring the increase in the PMC by 12 months, as requested by the Australian Tourism Export Council. Matt Hingerty put forward a very strong argument to the committee. He said, together with other witnesses, that this could not have come at a worse time in the history of the tourism industry—a 24 per cent increase, plucked out of the air, just like that. It is a tax measure where a lot of these moneys are going into general revenue.

I know there was Australian National Audit Office Audit report No. 1 1996-97, which said that there was an overcollection of, I think, some $19 million. That is a lot of money. So, is it a cost recovery measure or is it a tax? What is it? Can this government explain to the industry, the consumers and this parliament whether it is a cost recovery measure or a tax? If it is both, could they please explain exactly how much money they are collecting for cost recovery purposes for Customs, Quarantine and Immigration? Once we know what that figure is, we know what the overcollection figure is and what is going into general revenue. We need that transparency, and I want the government to come clean and explain that to the Australian people.

The Australian Tourism Export Council recommended a deferral, and we have recommended that modelling be commissioned on the impact of the increased PMC charge to determine the extent to which government charges are decreasing the competitiveness of the Australian tourism industry. Fortunately, that has been picked up by all senators, and I thank Senator Crossin, Senator Marshall and others who were involved in the debate for supporting that particular recommendation. I certainly acknowledge and thank Senator Mary Jo Fisher. I also thank Senator Russell Trood for his support with respect to this particular report.

Our third recommendation is for the implementation of a user-pays system for services, infrastructure and floor spaces occupied which are currently provided without charge at airports. Again, this is consistent with our view that there should be transparency and accountability. The government have got to come clean. These are private operators; these are small and large businesses, and they are providing these services at the moment free of charge to the government. The government might say, ‘This is what happened in the past.’ Well, the fact is that these airports in the past were primarily owned by the government. They are now privately owned.